5 Important Points to Discuss with your Mortgage Lenders in 2018
Getting a loan or a mortgage can be an exciting albeit challenging journey. Understanding the issues that inexperienced home buyers go through is a tough process because of the many different circumstances that we are in.
However, in this blog, we will be going through the 5 most important points that you NEED to discuss with your lenders in 2018.
1. Costs
Understanding the costs is an incredibly important aspect in receiving any type of loan or mortgage. No matter what you do, it is worthwhile to consider the cost associated with that particular service or product.
If you do not completely understand the costs and fees associated with a product or service, it is best that you ask about this information. Some fees that you may come across are – application fees, settlement fees, ongoing fees, fixed rate lock fees, valuation fees etc. Your mortgage broker can assist with clarifying these costs / fees for you.
2. Repayment Penalties
Repayment penalties is another crucial aspect of borrowing that you should always be on top of. Many lenders today have this information available, however, it is good practice to confirm this information either in person or in writing.
Repayment penalties normally are associated with a fixed rate loan – and paying it back before it has expired. For example a 3 year fixed rate loan – being paid out or refinanced say 1 year in. The calculation of any early repayment penalty is a mathematical algorithm and something that you will need to ring the lender on so that they can work it out and advise you.
3. Loan Fixed Rate Lock
A fixed rate lock is the process of locking in a certain interest rate in spite of market changes and fluctuations. What this does is secures the interest rate that is advertisied today – so when settlement happens in say 30 days you get that rate on the day.
Provides some comfort that you get the interest rate that you used to make your decisions on now – and helps in planning/securing your financial future.
4. Qualifying Criteria
Knowing the qualifying criteria is one of the first steps you should take. It is vital for you to know beforehand whether or not you are actually eligible. Employment types (casual, part time, Fam A & B payments, Self Employed) can all be assessed differently by the lenders.
In doing so, you will be able to spare yourself time of wasting applications etc that you are not eligible for. A mortgage broker can help guide you and let you know which lender will be suitable for you.
5. Loan Type
Not all loans are suitable for everyone. The individual circumstances of a person also play a key role in determining which type of loan is best. Therefore, it is important that you speak with your lender about which type of loan is most suitable for you.
Different type of needs will require different types of loans. Variable, fixed, combination, line of credit, P&I, Interest Only to name a few. Ensure you know exactly what your needs are and then you can have a chat to make sure you receive the most appropriate set up for you.
We hope that you enjoy this blog and found it useful, and if you want further information about the loans that we can provide advice on please click here.
Patrick Cranshaw, a Certified Mortgage Professional for over 21 years, founded North Brisbane Home Loans in 2002. His career began with ANZ Bank in New Zealand, where he progressed over 16 years to a Business Banking role in Virginia. After moving to Brisbane in 2000, Patrick led the QLD market for a home loan agency, helped set up the REMAX Real Estate Finance division, and practiced as a broker.
